Chapter 1
Property Rights and Interests
Course: Texas Real Estate Exam Prep
Subject: Texas State Salesperson Exam Prep
Chapter: Contract Law And Practice Of Texas Real Estate Salesperson Exam Prep
Classification of Contracts
By Formation:
- Express Contract
- Terms stated in words (written or verbal)
- Parties clearly articulate agreement
- Most real estate contracts are express
Example: Written contract for purchase of home with all terms specified
- Implied Contract
- Created by actions/conduct, not words
- Parties' behavior indicates agreement
- Rare in real estate
Example: Homeowner watches contractor repair fence, makes no objection, contractor expects payment (implied contract to pay reasonable value)
By Performance:
- Executed Contract
- Fully performed by all parties
- All obligations complete
- Contract closes out
Example: After closing, deed delivered, purchase price paid, possession transferred - contract is executed
- Executory Contract
- Not yet fully performed
- Parties still have obligations
- Most real estate contracts from signing to closing